A country is not a company

Tokyo

THE Bank of Japan (BOJ), this country's equivalent of the Federal Reserve, has lately been making a big effort to end deflation, which has afflicted Japan's economy for almost two decades. At first its efforts - which involve printing a lot of money and, even more important, trying to assure investors that it will keep printing money until inflation reaches 2 per cent - seemed to be going well. But more recently the economy has lost momentum, and last week the bank announced new, even more aggressive monetary measures.

I am, as you might guess, very much in favour of this move, although I worry that the policy might nonetheless fail thanks to fiscal mistakes. (More about that later.) While the bank did the right thing, however, it did so amid substantial internal dissent. In fact, the new stimulus was approved by only five of the bank board's nine members, with those closest to business voting against. Which brings me to the subject of this column: the economic wisdom, or lack thereof, of business leaders.